April 20, 2010 (FinancialWire) — Pacific Ethanol, Inc. (NASDAQ: PEIX) said that on April 16, 2010, its wholly-owned subsidiary, Pacific Ethanol Holding Co. LLC (PEH), together with PEH's four wholly-owned ethanol production facilities, filed an amended plan of reorganization and related draft disclosure statement with the U.S. Bankruptcy Court in Delaware in continued cooperation with its lenders.

Under the original plan of reorganization, the ownership of the plant subsidiaries will be transferred to a newly formed holding company. The amended plan now includes terms under which the lenders may grant the company an option to purchase up to 25% of the total ownership interests in the new holding company (new PEH) for up to $30 million in cash.

The option would be exercisable until 90 days following the court's confirmation of the amended plan. The company still expects PEH and the plant subsidiaries to emerge from bankruptcy near the end of the second quarter of this year.

Under the amended plan, the new PEH term debt will be reduced by $67 million to $50 million. In addition to the term debt, the amended plan continues to provide working capital of up to $15 million, which may be increased up to $35 million as provided in the original plan.

Neil Koehler, Pacific Ethanol's CEO and president, said, "Under this plan the plant subsidiaries would emerge with an even lower level of debt while providing sufficient liquidity to support existing operations and resume production at the Madera and Stockton, California facilities."

The company and its subsidiaries, other than PEH and the plant subsidiaries, have not filed for protection under the U.S. Bankruptcy Code. As a result, their ownership structure will not change. Upon confirmation of the amended plan, the company's balance sheet will reflect the disposition of the Plant Subsidiaries' assets and cancellation of their related secured debt of approximately $293.5 million.

The company will continue to staff, manage and operate the four ethanol production facilities held by the plant subsidiaries for a negotiated fee and profit-sharing arrangement. In addition, the company, through its other subsidiaries not in bankruptcy, will continue marketing ethanol for third parties as well as the ethanol and related feed products produced by the four facilities.

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